Justices, in Ruling on Free Speech, Put Limits on Government

By LINDA GREENHOUSE,

Published: June 1, 1994

WASHINGTON, May 31—
Defining the free-speech rights of public employees, a splintered Supreme Court today placed new limits on the ability of government agencies to punish employees for what they say.

A plurality of four Justices held that government workers cannot be dismissed or otherwise punished for their words unless the employer has a reasonable basis for believing that the speech was either disruptive or that it involved a matter of purely private concern, outside the scope of the First Amendment's protection.

While a government agency or institution need not conduct a full-scale investigation, it must have some reasonable, factual basis for its punitive action, Justice Sandra Day O'Connor said in her opinion for the plurality. The opinion rejected the argument put forward by the Clinton Administration in support of an Illinois public hospital that dismissed an obstetric nurse who complained to co-workers about the hospital's staffing policies.

A number of organizations representing public employers, including the National League of Cities and the National Governors Association, signed a brief supporting the hospital. The Administration said it was participating in the case because the Federal Government, with 3.1 civilian employees, is the nation's largest public employer. Opposing Arguments

The Administration, along with the hospital, argued that the hospital had no duty to investigate what the nurse had actually said and that her dismissal was not unconstitutional unless the hospital had been motivated to retaliate against her for exercising her First Amendment rights. Justice O'Connor said that while the employer must have acted in good faith to avoid liability, "it does not follow that good faith is sufficient."

In a separate opinion, Justice Antonin Scalia accused the plurality of having created "a broad new First Amendment procedural right" that would subject public employers to "intolerable legal uncertainty.

The decision was not necessarily a victory for the nurse, however, because Justice O'Connor's opinion rejected a still more protective standard that a Federal appeals court in Chicago had adopted in this case. That court, the United States Court of Appeals for the Seventh Circuit, ruled in 1992 that whatever the hospital believed about the situation was irrelevant, and that only a jury could determine the facts after a trial.

"Government employers should be allowed to use personnel procedures that differ from the evidentiary rules used by courts without fear that these differences will lead to liability," she said. For that reason, courts should not conduct a full inquiry, but need only "look to the facts as the employer reasonably found them to be." Two Justices in Dissent

While taking different approaches, both Justice O'Connor's opinion and Justice Scalia's agreed that the Seventh Circuit's ruling should be set aside. Justice O'Connor's opinion was joined by Chief Justice William H. Rehnquist and Justices David H. Souter and Ruth Bader Ginsburg. Justices Anthony M. Kennedy and Clarence Thomas joined Justice Scalia.

The two other Justices, John Paul Stevens and Harry A. Blackmun, filed a dissenting opinion saying that the plurality's approach was insufficiently protective of employees' First Amendment rights.

"The risk that a jury may ultimately view the facts differently from even a conscientious employer is not, as the plurality would have it, a needless fetter on public employers' ability to discharge their duties," Justice Stevens wrote for himself and Justice Blackmun. He said the First Amendment requires that "before firing a public employee for her speech, management get its facts straight."

As a practical matter, the ruling's effect may be limited because many public employees work under contracts or Civil Service rules that give procedural protection against dismissal or discipline. Nonetheless, the decision, Waters v. Churchill, No. 92-1450, was probably the Court's most important ruling in more than a decade on the constitutional rights of government workers. Framework in 1983 Ruling

A 1983 decision, Connick v. Myers, established the framework the Court dealt with today. Under that ruling, a government employee's speech is protected by the First Amendment as long as it is not disruptive and is on a subject of public, as against personal, concern. But the decision left open the issue of how a court should arrive at the factual basis for applying that test: What steps did the employer have to take to ascertain the specific nature and impact of the speech?

Justice O'Connor said today that the employer in this case, McDonough District Hospital in Macomb, Ill., had taken reasonable steps to investigate reports about the nurse's complaints before dismissing her. The hospital management concluded that the nurse had not only complained about the personnel policies but had also disrupted the workplace by dissuading a colleague from transferring to the obstetrics department.

Still, Justice O'Connor said, there was an unresolved dispute about whether the nurse's criticism was really the basis for the dismissal or simply a pretext for an action that the hospital management wanted to take as the result of earlier, constitutionally protected statements the nurse had made. Justice O'Connor said the nurse, Cheryl R. Churchill, was entitled to a trial at which she could try to prove that the dismissal was impermissible for that reason.